BMW is in this buisness to make money.. And if demand for the M5 was for 5000 cars this year I doubt bmw would be decreasing supply. Therefore I don't think your reasoning is why BMW is lowering supply of the M5(to maintain exclusivity)

I am not reasoning anything, I am telling you what I heard. The logic (as was expressed to me) was that BMW introduced the E34 M5 in 1991 and they stopped importing it in 1993 because of sagging demand and resale values. The E39 M5 is still in demand (and commanding prices over MSRP more than 12 months after intro). The prices are coming down, therefore supply is nearly caught up with demand. The only way to keep prices up is to limit supply. Again, I am not reasoning anything, I am just telling you what I was told and why they are going to do it. Take it FWIW, I could be wrong.

Hell, If demand was for 50,000 m3's I think BMW ought to produce 50,000 m3's.. Would lower the cost and more people would get to enjoy the ultimate driving experience. Most of us aren't here for an image. We're here to buy a kick ass car. Simple as that.

The people here won't make up 1% of the people that buy the M3. Contrary to what you might want to believe, most people buy a BMW and more precisely an M3, for the cachet value. Sad but true.

The M cars are not profit makers. It just so happens they make a nice profit, but the M cars serve one and one one function- to show what BMW engineering can do and be the image leader for BMW. Tell me how many articles there have been in the cars rags about the E36 M3 over the past 6 years? People see that, go to the dealer and either don't want to pay M3 prices or can afford it so they get a 325 (or any other BMW from the 325 to 750). Why on Earth do you think auto manufacturers spend so much money on car racing (last I heard F1 costs manufacturers at least $100 million per year)? How many F1 cars has BMW sold in the past year? None. How many E46/E39s have they sold becuase of racing success? Lots. It's all about press. Win on Sunday, sell on Monday. Gushing reviews in car rags sell lots of cars. BMW makes M cars for one reason, and one reason only...IMAGE. As one soft drink (Sprite?) says...image is everything.